SuRaLa Net Co., Ltd. (3998) AI Stock Analysis

SuRaLa Net Co., Ltd.

(TSE/TYO:3998)

Select Model

Rating:61Neutral

Price Target:JPY 248.00▲(5.53% Upside)

Action:reiterated

Date:08/04/26

The score is primarily supported by a very strong, low-risk balance sheet and generally positive cash generation, but it is held back by materially weakened profitability (including slightly negative net income) and an unattractive earnings-based valuation signal (negative P/E). Technicals are supportive of an uptrend, but overbought readings temper the outlook.

Positive Factors

Recurring EdTech contractsRecurring platform and content contracts can create a more durable revenue base than one-time product sales. Expansion across students, grades, subjects, or schools may also deepen existing customer relationships and support continued account-level growth over the next several quarters.

Negative Factors

Structural margin erosionThe multi-year decline in EBITDA margin shows that revenue growth is currently producing substantially less operating profit than in earlier periods. Persistent margin pressure would reduce the benefit of scale, limit internally funded investment, and make future earnings more sensitive to execution or cost changes.

SuRaLa Net Co., Ltd. (3998) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 1.48B
Dividend Yield: ―
Average Volume (3M): 12.01K
Price to Earnings (P/E): -32.2
Beta (1Y): 0.49
Revenue Growth: -2.24%
EPS Growth: -140.19%
Country: Japan
Employees: 104
Sector: General
Sector Strength: 55
Industry: Education & Training Services

SuRaLa Net Co., Ltd. Business Overview & Revenue Model

Company Description

SuRaLa Net Co.,Ltd. specializes in delivering online educational solutions, catering to markets both within Japan and globally. Additionally, the firm offers a suite of supplementary services, including operational advisory, promotional strategies, a...

How the Company Makes Money

SuRaLa Net primarily makes money by providing its e-learning products and related services under contracts to educational customers. Key revenue streams are: (1) Usage/license fees for its “Surala” learning platform and digital content, typically cha...

SuRaLa Net Co., Ltd. Financial Statement Overview

Summary

Income statement quality is weak despite 2025 revenue re-acceleration (+27.8%) as profitability deteriorated sharply (net income slightly negative and EBITDA margin down to ~13% vs ~21% in 2024 and ~30%+ in 2021–2023). Offsetting this, the balance sheet is very strong with essentially no debt and a large equity base, and cash flow is generally positive with free cash flow rebounding in 2025 (¥238mm) after a negative 2024—though cash generation remains choppy.

Income Statement

46Neutral

Balance Sheet

82Very Positive

Cash Flow

64Positive

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.88B	1.93B	1.95B	2.15B	2.15B	1.95B
Gross Profit	1.10B	1.17B	1.23B	1.47B	1.54B	1.47B
EBITDA	296.34M	356.98M	483.56M	629.53M	660.93M	659.38M
Net Income	-45.73M	-3.78M	72.89M	304.35M	355.40M	399.78M
Balance Sheet
Total Assets	2.99B	2.48B	2.67B	2.71B	2.67B	2.13B
Cash, Cash Equivalents and Short-Term Investments	1.18B	767.89M	1.06B	1.15B	1.33B	1.24B
Total Debt	500.00M	0	0	1.50M	107.50M	0
Total Liabilities	792.51M	275.19M	407.10M	457.05M	600.73M	415.13M
Stockholders Equity	2.18B	2.19B	2.24B	2.22B	2.03B	1.71B
Cash Flow
Free Cash Flow	0	238.26M	372.40M	475.30M	509.98M	281.85M
Operating Cash Flow	0	239.65M	372.85M	475.54M	542.50M	502.68M
Investing Cash Flow	0	-484.42M	-414.90M	-433.83M	-503.71M	-222.88M
Financing Cash Flow	0	-48.40M	-51.69M	-220.51M	50.11M	11.76M

SuRaLa Net Co., Ltd. Technical Analysis

Technical Analysis SentimentNegative

Last Price235.00

Price Trends

50DMA276.50Negative

100DMA292.65Negative

200DMA306.39Negative

Market Momentum

MACD-13.67Positive

RSI26.78Positive

STOCH30.78Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3998, the sentiment is Negative. The current price of 235.00 is below the 20-day moving average (MA) of 252.50, below the 50-day MA of 276.50, and below the 200-day MA of 306.39, indicating a bearish trend. The MACD of -13.67 indicates Positive momentum. The RSI at 26.78 is Positive, neither overbought nor oversold. The STOCH value of 30.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3998.

SuRaLa Net Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:3998 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:9560	84Outperform	JPY 13.99B	12.14	―	2.01%	33.05%	27.11%
JP:9339	79Outperform	JPY 3.51B	35.05	―	1.36%	-1.08%	108.06%
JP:7353	62Neutral	JPY 3.45B	8.67	―	―	11.12%	64.89%
JP:9345	62Neutral	JPY 1.91B	10.78	―	2.66%	-2.92%	-20.86%
JP:3998	61Neutral	JPY 1.57B	-32.23	―	―	-2.24%	-140.19%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%

* General Sector Average

Performance Comparison

JP:3998 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:3998	SuRaLa Net Co., Ltd.	235.00	-130.00	-35.62%
JP:7353	KIYO Learning Co Ltd	502.00	-291.00	-36.70%
JP:9339	COACH A Co., Ltd.	1472.00	58.48	4.14%
JP:9345	Bizmates,Inc.	564.00	-235.68	-29.47%
JP:9560	PROGRIT, Inc.	1097.00	158.23	16.85%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Aug 04, 2026

SuRaLa Net Co., Ltd. AI Stock Analysis